Canara Bank has successfully raised ₹35 billion through the issuance of Basel III-compliant Additional Tier I (AT1) bonds. The fundraising enhances the bank’s capital adequacy, supports regulatory requirements, and provides flexibility for future growth. This move reflects strong investor confidence in the lender’s stability and long-term expansion strategy.
Public sector lender Canara Bank announced that it has raised ₹35 billion by issuing Basel III-compliant Additional Tier I (AT1) bonds. These perpetual debt instruments, which qualify as regulatory capital, are designed to strengthen the bank’s capital adequacy ratio and ensure compliance with Reserve Bank of India (RBI) norms.
The successful issuance underscores investor confidence in Canara Bank’s financial health and growth prospects. AT1 bonds, often considered high-risk instruments due to their loss-absorption features, were subscribed at competitive yields, reflecting strong demand from institutional investors.
This capital infusion will provide Canara Bank with greater flexibility to expand lending operations, support infrastructure financing, and meet future regulatory requirements, positioning the bank to play a larger role in India’s economic growth.
Key Highlights / Major Takeaways
Fundraising Size: ₹35 billion raised via AT1 bonds.
Compliance: Fully Basel III-compliant, qualifying as regulatory capital.
Investor Confidence: Strong demand despite risk profile of AT1 instruments.
Strategic Goal: Strengthen capital adequacy and support growth initiatives.
Sector Impact: Reinforces PSU banks’ role in financing India’s development.
Sources: The Hindu BusinessLine, Economic Times, Moneycontrol (Corporate Announcements)